How New York can survive The city's decay is not inevitable

The tired refrain that cities always recover ignores the spectre of long-term, permanent decline. History is replete with cities fading into obscurity and even non-existence, from ancient Carthage to Ctesiphon, capital of ancient Persia, Vijayanagar in India or Great Zimbabwe in Africa. Across the West, major industrial cities have been shrinking, from Liverpool and Manchester to Osaka and Adelaide, with little prospect of rapid recovery. For over a century, growth has shifted to the suburbs and exurbs — not only in the United States, but in the old cities of Europe too, including London and Paris.

These trends accelerated during the pandemic. Even as the virus has receded, the return to the office has been slower than some predicted. And of all the nation’s major cities, New York has suffered the slowest post-pandemic job recovery, with midtown offices still half-empty.

Yet this drift was taking shape even before the pandemic. Across the US, office occupancy has been declining since 2000, while construction of new space has fallen consistently for 25 years. In 2019, before the pandemic, construction was one-third the rate of 1985 and half that of 2000. Now faced with a recession or at least a slowdown, office absorption is likely to remain at historically low rates, with the potential loss of value in central-business-district offices reaching $500 billion in New York alone.

But even as New York’s office economy struggles, there are distinct signs of life, driven not by necessity but by people and industry. New York, for all its plight, remains dominant in those fields — media, culture, and tourism — where urban areas remain competitive with the hinterland. It also includes medical facilities, which need highly skilled workers and where agglomeration effects allow the city to export medical services. Less positive is its decision to bet its future on casino gambling and pot stores, not exactly a substitute for higher end activities. Yet overall, in this new urban order, New York is easily the best placed of America’s cities to thrive. It still attracts the global rich, boasts some of the world’s best museums and restaurants, as well as large arts communities.

This magnetism sets New York against its prime competitors — Los Angeles and Chicago — in the struggle for increasingly scarce urban investment opportunities and for potential residents. Chicago has been particularly diminished by corruption, poor governance, higher homicide rates than New York and consistent business emigration to other less taxed and often warmer states. High crime, notes sociologist Glenn Loury, a Chicago native, has created “a great unraveling” that means Chicago could become “a decaying husk of a formerly great city”.

Perhaps a bigger surprise has been the decline of Los Angeles, now the country’s second-biggest city and metropolitan area. LA, with its car-oriented, multipolar economy, once boasted a large concentration of engineers, a thriving immigrant economy and the nation’s dominant entertainment centre and port. But a succession of deluded mayors, all seeking to create a “green” transit and downtown-oriented city, has left LA gridlocked and impossibly expensive. Elsewhere, its port has surrendered its lead as the country’s top trade hub, while its real-estate market ranks among the worst in the country.

Is New York’s fate to limp into the future simply by virtue of being better than its rivals, even as its economic essence drifts to the south?  Much depends on politics. The roots of its urban failure lie largely in the failed policies — sceptical of law enforcement, dogmatically green and seeking ever more density — adopted by “new Left urbanists” such as former Mayor Bill DeBlasio. But in contrast to Chicago and Los Angeles, New Yorkers have shown at least some recognition of the critical demand for personal security,  electing a former cop, Eric Adams, as Mayor.

Adams, who ran on an anti-crime platform, is boosting the police, and recently announced his determination to make its streets safe. But Adams may not be a second Giuliani, who, before his recent transformation into a Trumpian fabulist, sparked the city’s revival by dramatically reducing crime. Unlike his Republican predecessor, Adams faces a much more progressive council, as well as determined opposition from the New York Civil Liberties Unions. But at least he’s shown signs of understanding the concerns of the city’s beleaguered working and middle classes — even if the criminals still seem to have the upper hand, forcing local business to either close early or move out.

Finally, if Adams’s plans work, the “entertainment machine” model has its limitations, and could worsen the already severe inequality  that has bedeviled cities even in the best of times. To begin to provide opportunities to the bulk of his constituents, Adams will have to rethink New York’s over-centralised economy. He needs to rethink the city not as a massive Manhattan hub, surrounded by rings of economically dependent neighbourhoods and suburbs, but as a multi-polar collection of villages that can house the creative workforce at the centre of a re-invented economy.

After all, the talent attracted to the city — both creative and immigrant — remains its greatest asset. These are the people, many working remotely, who cluster in urban neighbourhoods such as Park Slope, Carroll Gardens, and Brooklyn Heights, as well as Tribeca, Soho, and Greenwich Village in Lower Manhattan. Similarly its minority neighbourhoods — Flushing, Jackson Heights, Sunset Park — remain cultural gems and potential source of entrepreneurial vigour.

Yet it remains to be seen whether New York as a whole can recover; the city and state are in awful fiscal shape and unlikely to have the resources to address serious problems. Mayor Adams and Governor Kathy Hochul might talk of their “moonshot goal” to create 500,000 homes, but it’s unclear where the money will come from, while one wonders where the customer base will be in a shrinking city. Meanwhile, an alternative vision of a dispersed future will be resisted by powerful real-estate interests, planners and urban boosters who see the current downturn as a temporary phenomenon. Its urban planners see every neighbourhood — including middle-class areas — as suitable for relentless densification and gentrification.

But rather than force expensive (or subsidised) dense housing, the city should think about building more areas such as Sunnyside in Queens. These moderately low-density neighbourhoods may yet attract, and more importantly retain, the creative workers and immigrant entrepreneurs critical to the its future. Queens is already the most diverse of all the city’s boroughs and arguably the most in the country.

The key task in the coming years will be to convince enough New Yorkers — not just the rich and richly endowed — that the city can be congenial to families and ambitions outside Wall Street. Combined with its unique legacy, even in a de-urbanising world, no other place in America is likely to compete as successfully. But to reach its potential, New York will need a major shift in urban consciousness, and an understanding that its greatness lies not in economic form or soaring architectural renderings, but in the richness of its heritage, its neighbourhoods, and its people. For all its problems, and bitter experience with the pandemic, New York has the capacity to lure enough people and businesses to retain its vitality — and remain “the most fatally fascinating place in America”.

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Joel Kotkin is a Presidential Fellow in Urban Futures at Chapman University and a Senior Research Fellow at the Civitas Institute, the University of Texas at Austin.

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